WOLFSBURG: Volkswagen employees initiated a two-hour “warning strike” at the automaker’s production plants in Germany on Monday. The walkout was organized after wage negotiations between IG Metall, the country’s largest metalworkers’ union, and Volkswagen management reached an impasse.

According to Anadolu Agency, the short strikes were part of a broader response to Volkswagen’s plans to shut down at least three of its German factories, a move unprecedented in the company’s history. Protesters are expected to assemble not only at the company’s headquarters in Wolfsburg but also at other locations across the nation.

The IG Metall union had previously put forth a proposal aimed at cutting $1.6 billion in labor costs to prevent the closures. This plan involved foregoing future pay increases in exchange for reduced working hours at certain plants, without offering bonuses. However, Volkswagen rejected the proposal. The next wage negotiation round is set for December 9.

Volkswagen, in an announcement dated Octo
ber 28, stated that its downsizing initiative would impact around 300,000 employees. The company also disclosed plans to terminate its 30-year-old employment protection plan five years ahead of schedule, while demanding a 10% salary reduction for workers to sustain market share and cut expenses. The company’s rationale for the factory shutdowns included high energy and labor costs in Europe, diminished competitiveness, and waning sales, as reflected in a 60% profit drop reported in October.

IG Metall criticized Volkswagen’s offer as insufficient, arguing that it overlooks the severe impact of the current economic climate on 3.9 million workers who require higher wages. The union dismissed Volkswagen’s proposal of a 3.6% wage increase as inadequate. The automaker’s decision reverberated throughout the German auto industry, particularly amidst inflationary pressures, sluggish economic growth, and political uncertainty following snap elections triggered by Chancellor Olaf Scholz’s dismissal of the finance minis
ter and the dissolution of the coalition government.